Now that Photoshop CS can really give you type in a circle, getting a perfect circle that you can add type to is not as obvious as you'd think.

To get this perfect circle, click on the Shape tools in the Toolbox and choose the Ellipse tool from the flyout menu. Then go up to the Options Bar, and in the second group of icons from the left, click on the middle icon, which creates a regular path, rather than a Shape layer or a pixel-based shape.

Then, hold the Shift key, and drag out your circle (the Shift key constrains the shape to a perfect circle). Now you can move your Type tool over the circle, and it will change into a Type on a Path cursor. Click on the circle, and get to typing.